Arithmetic coding is described in:
Witten, I. H et al, “Arithmetic coding for data compression”, Computing Practices, Communications of the ACM, June 1987, Vol. 30(6); and
“Arithmetic coding and statistical modeling”, Dr. Dobb's Journal, February 1991, pp. 16-29.
The MR decoding scheme is described in CCITT Recommendation T.4 and T.6 for Groups 3 and 4.
A conventional binarizing technique is described in Foley, J. et al, Computer Graphics: Principles and practice, 2nd Ed., Section 13.1.2, pages 568-573.
The disclosures of all of the above publications are hereby incorporated by reference.